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Dram Shop Law Cases: Why You Need Liquor Liability Insurance

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bartender making drinks

Dram shop laws and Liquor Liability Insurance can be pretty confusing topics to make sense of. When you run a business where you either host events and serve alcohol, bartend, or provide alcohol in any capacity, you need to be well-versed in why your business needs liquor liability and how it could help your business.

Today we’ve put together some info on the kinds of expensive claims your business could see if you don’t carry the proper coverage for you and your business.

But first, let’s review some basic liquor liability information.


Dram Shop Insurance or Liquor Liability Insurance, is designed to financially protect your business against third-party claims that your serving alcohol to someone who is over intoxicated or is a minor caused harm or damage to an individual or a piece of property. It protects you if you are sued and could help cover the costs of legal aid, court filings, and other associated fees.


You do! If you’re reading this blog and run a business where you host events with alcohol, bartend, or brew your own drafts for the public, then you need a Liquor Liability Insurance policy.


Dram shop law cases and their verdicts usually come about as a result of bodily injuries or property damage caused by an intoxicated individual who was likely over served alcohol and permitted to leave in their intoxicated state. Laws vary depending on where you live, and can also reflect any claims of providing alcohol to minors.

Many of the following claims are similar, but we’ll give you the main details to show you just how serious a liquor liability claim can really be.

  • $2 Million Wrongful Death Case, FL— In this case involving the wrongful death of a young police officer, the bar was held liable for serving alcohol to a known alcoholic and letting him leave the property in his drunken state. The man ended up driving on the wrong side of the highway, killing himself and the police officer.
  • $2.5 Million Manslaughter Case, MI — A drunken individual left a bar and was permitted to get his vehicle by valet service. After being found passed out by the manager of the establishment, the individual drove home and crashed into eight other cards, killing one of the drivers.
  • $2 Million Country Club Claim, NC — In the first ever dram shop law verdict in North Carolina, a server at a country club and the country club itself, were found guilty when they served a golfer liquor, not knowing he had been drinking all day. Upon leaving, the golfer caused an accident that killed a young boy.
  • $20 Million Insurance Pay Out, PA — When dram shop law cases fail to be settled for the typical $1-2 million, they can get to extremely large amounts of money. In Pennsylvania, Princeton Insurance Co. was made to pay out $20 million after a panel of judges decided the individual who had caused a death was at fault as well as the establishment where he was a manager.
  • $37.5 Million Paid Out, IL— A man was left severely disabled after being hit by a drunk driver on an interstate in Illinois. The judge’s verdict was that the club the man had been drinking at failed to stop serving him after he showed signs of intoxication.

Dram shop laws are in place for a reason. They’re set up to prevent events such as these from happening, but that doesn’t mean they completely stop. Carrying liability insurance for your liquor business or for your events can help you from dealing with such a claim on your own.


Bars, country clubs, taverns, breweries, caterers, and you as a responsible event host, are required to be responsible with how they go about serving liquor.

It’s important to know the signs of an intoxicated person and to follow any protocol that may be in place to deal with these issues. Continuing to serve a customer who is already drunk can cause the business and the individuals who served them to be responsible if the customer leaves the establishment and causes an accident.

Would you be able to deal with having to pay millions of dollars in settlements? And that’s not even to mention the cost of defending yourself through the process.

Liquor Liability Insurance from Insurance Canopy provides you with the proper safeguards for your business as a bartender, brewer, server, or event host. Liability insurance starts at just $35.42 a month depending on your business and can greatly help you in the long run.

If you have any questions about this policy, feel free to reach out to our agents via email at or by phone at 844.520.6993.

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